Where do Canada's post-secondary dollars go?

Tuition fees on the rise, public funding on the wane

Protesters calling for free student tuition demonstrate in Montreal. Tuition fees have risen at Canadian universities, but public funding on a per student basis has fallen off over the past two decades. (Graham Hughes/Canadian Press)

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When teaching assistants went on strike recently at two Toronto universities, their job actions were only the latest reminder of the fiscal strife that has run in lockstep with the significant growth at Canadian post-secondary schools over the past two decades.

Any talk of money in post-secondary education involves big numbers that just seem to keep getting bigger.

CUPE Local 3902 members rally outside the main gates of York University after the strike by teaching assistants and contract faculty began earlier this month. (Linda Ward/CBC)

Universities and colleges spent $32.4 billion in 2012/2013 and had approximately 1.5 million full-time students, up from $15.3 billion and one million 12 years earlier, according to Statistics Canada.

But try to determine exactly where all those billions go — and who gets what share of the pie — and the picture gets murky.

"It's not nearly as clear as one would hope," says Kate Lawson, president of the Ontario Confederation of University Faculty Associations.

In fact, there's enough lack of clarity that Lawson's organization has a committee to train academics in how to read university financial statements.

Million-dollar presidents

But while clarity may be tough to come by, there is no shortage of opinion about how the money is being spent.

Students and faculty complain of mounting administrative costs.

And figures from OCUFA show non-academic full-time salaries at Ontario universities, adjusted for inflation, rose 78 per cent from 2000/01 to 2013/14, from $934 million to nearly $1.7 billion.

Most of that is for administration at all levels, although "we can't determine from the existing data how much senior administration salaries increased on their own," says OCUFA communications manager Graeme Stewart.

Almost 90 per cent of Dalhousie University's operating budget comes from two revenue sources: government grants and tuition revenue. (Andrew Vaughan/Canadian Press)

At Dalhousie University in Halifax, for example, compensation for faculty and staff is 72 per cent of the total budget.

And within the $238.5-million salary budget in 2012/13, senior administration salaries represented 5.9 per cent, according to the university's 100 Days of Listening report. Academic salaries comprised 53.4 per cent of the total while staff salaries were 40.7 per cent.

"Overall we need to ensure that we continue to have a market-competitive compensation package, with a mix of salary, benefits and pension that ensures that the best and brightest are attracted to and retained at Dalhousie," said the report.

But presidential salaries and compensation have seemed especially galling to some critics.

The University of Alberta, for example, hit the headlines when it was reported in 2010 that its president's annual compensation and benefits were valued at nearly $1 million.

Even a budget of up to $50,000 for speechwriting for the University of Guelph president riled students last month.

'Troubling priorities'

From the student perspective, salaries for university presidents and vice-presidents seem to be on the rise at the same time as tuitions are increasing and "while contract academic staff suffer," says Jessica McCormick, chairperson of the Canadian Federation of Students.

"Those are some troubling priorities."

'Universities are important ways of building fairness and equity in our society.'- Kate Lawson

Others see faculty taking home very comfortable pay cheques. Professors in Ontario, for example, routinely show up on the so-called Sunshine List of salaries that top $100,000 at publicly funded institutions.

Teachers take issue with that, of course.

"I think one of the more popular misconceptions is that the rising cost of higher education … is related to salaries of professors," says David Robinson, executive director of the Canadian Association of University Teachers.

"If you look at the overall increases in expenditures at universities, overall costs are up over the past 10 years about 220 per cent or so. Salaries are up about 100 per cent, so salaries haven't been the real cost driver."

New cost drivers, Robinson says, are advertising for students, as well as bursaries and scholarships, to offset the rising cost of tuition.

In Ontario, figures from OCUFA show spending on scholarships and bursaries rose from $278 million in 2000/01 to $840 million in 2013/14, an increase of 302 per cent. Adjust those numbers for inflation, and the increase is 135 per cent.

Public funding falling

Another factor here is that the rising price tag for post-secondary institutions comes as public funding, at least on a per student basis, has fallen off.

In the 1960s and '70s, governments covered more than 90 per cent of post-secondary costs. By 2013, that figure had decreased to 57 per cent, according to the Canadian Federation of Students.

In Ontario, tuition now covers 51 per cent of university operating budgets, says Lawson, who notes the province has the lowest level of per student funding in Canada.

At Dalhousie, the ratio of the university's two main sources of operating revenue — government grants and tuition — "shifted dramatically in the past two decades," the 100 Days report noted.

"From 1992/93 to 2012/13, the provincial grant declined from 74 per cent to 54 per cent of operating revenue.

"The gap has been filled primarily by tuition revenue through enrolment growth and fee increases as tuition revenue went from 18 per cent of operating revenue in 1992/93 to 36 per cent in 2012/13."

No silver bullet

Many of those involved in post-secondary education see a need for increased public funding, arguing it is a healthy investment in the economy.

"Universities are important ways of building fairness and equity in our society," says Lawson.

At the same time, there are those who say students ought to shoulder a larger share of higher education, especially in professional schools, as they are the ones who will enjoy the fruits of that down the road.

'There is no silver bullet to the budget pressures that face Dalhousie or indeed most other universities around the world.'- Dalhousie University report

At Dalhousie, there's a desire to find new revenue from government and other sources, along with looking for ways to boost productivity and "achieve more of our mission at the same cost," says the 100 Days report.

But ultimately, the report states, "there is no silver bullet to the budget pressures that face Dalhousie or indeed most other universities around the world."

"We've got to be pragmatic and understand that there's no more public dollars easily available for education in an environment where health-care financing is another top, top priority and people in power are aging," says Diana MacKay, executive director of education, skills and immigration at the Conference Board of Canada.

"Voters are aging so you can understand why financing health care may win out. Despite all evidence to the contrary that it might be smarter to invest in education, it's not going to be easily done."

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